The Legislative Budge Board, in cooperation with the Texas Water Development Board (TWDB) and the Texas Commission on Environmental Quality (TCEQ), has determined the following:

The bill would creates the NASA Area Management District in Harris County with the powers and duties of a Municipal Management District (MMD) governed by Chapter 375, Local Government Code.

1) Population- The City of Nassau Bay population for use in the 2007 State Water Plan is expected to remain constant at 4,170.

2) Location & Size- The District would include an area within Harris County. Insufficient information has been provided to determine acreage of District.

3) Powers- The District has the rights, powers, privileges, authority, and functions of a general law MMD. The District also would have the power given to a corporation under the Development Corporation Act (Section 4B, Article 5190.6, VTCS); the power of a housing finance corporation under Chapter 394, Local Government Code; the power to create a nonprofit corporation under Chapter 431, Transportation Code; the power and authority of a municipality under Chapter 380, Local Government Code; and the power to impose a sales and use tax under Chapter 321, Tax Code.

4) District Finances- Similar to general law MMDs, including the authority to levy benefit assessments, ad valorem taxes, and issue bonds. In addition, the District would have the ability to impose a sales tax. The District must obtain the approval of the City of Nassau Bay’s governing body for the issuance of bonds, imposition of a sales and use tax, and the imposition of an assessment on residential property. A petition signed by the owners of a majority of the assessed value or surface area in the District, is required prior to financing projects.

5) Board of Directors- The District would be governed by a board of seven voting directors who serve staggered terms of four years, with three or four directors terms expiring June 1 of each odd-numbered year. Three non-voting directors will come from the City of Nassau Bay. The mayor and members of the governing body of the City of Nassau Bay shall appoint the initial seven voting directors, and may change the number of directors to vary between 5 and 15.

6) Eminent Domain- Like general law MMDs, the District may not exercise the power of eminent domain.

7) Ability to Tax- The District may impose assessments, impact fees, ad valorem debt service, and operation and maintenance taxes according to Chapter 375, Local Government Code. With City of Nassau Bay approval, the District may impose a sales-and-use tax. The District may not impose an impact fee or assessment on the property, equipment, or facilities of an electric utility, power generation company, gas utility, or telecommunications provider.

8) Ability to Exclude Property- Same as a general law municipal management district under Chapter 375, Local Government Code.

9) Overlapping Services- An adequate boundary description and location map was not provided for the proposed District; therefore, an overlap check could not be performed.

10) Adequacy of Boundary Description- An adequate boundary description and location map were not provided for the proposed District.

11) Comments on Powers/Duties Different from Similar Types of Districts- Subject to approval from the City of Nassau Bay, the District may impose sales taxes. Also, the District may authorize the creation of a nonprofit corporation to assist and act on behalf of the District in implementing a project or providing a service.

12) TCEQ’s Supervision- The District is exempt from TCEQ auditing and bond review authority unless the bonds are issued specifically for water, wastewater, or drainage facilities.

13) State Water Plan Objectives: Water Use- Creation of this district would not conflict with State Water Plan objectives.